IIP spooks Sensex…Nifty below 6100

The Indian equity markets ended in the red after India's IIP expanded at a sharply slower pace in August after surging in the previous month. India's IIP grew by just 5.6% in August 2010 after expanding by an impressive 15.2% in July.



Sentiment was further hit after the European markets opened weak note and most Asian markets slid, barring China.

Realty stocks continued bore the brunt of the sell-off. Capital Goods stocks were also under pressure after poor IIP data and Metals stocks also lost their shine. The BSE FMCG index and the BSE Consumer Durables index also lost 1% each following the downbeat IIP numbers.

The lower-than-anticipated IIP data spooked the sentiment. All eyes are now on Friday's inflation report for September and the Infosys results. It would be interesting to see what the RBI does at its next policy meeting in November. says Amar Ambani, Head of Research (India Private Clients) - IIFL.

The BSE Sensex slipped 137 points to close at 20,203. The NSE Nifty lost 49 points to close at 6,091.

Among the BSE sectoral indices, the BSE Realty index was the top loser, losing by 1.8%, followed by the BSE Capital Goods index (down 1.6%) and BSE Metal index (down 1.4%). On the other hand, the BSE IT index gained 0.2% and BSE Pharma index gained 0.2%.

The broader indices ended mixed, the BSE Mid-Cap index ended loser by 0.5% and BSE Small-Cap index ended flat.

The European indices were trading lower, the DAX in Germany was down 0.6%, the CAC 40 index in France also down up 1.2% and FTSE index in UK down 0.8%.

Outside the frontline indices, the big losers in the broader market were Exide Ind, United Spirits, Jubilant Org. On the other hand, losers included M&M Fin, United Pros, RCF and MTNL.